Summary highlights of all EE Global Executive Dialogue sessions are now available! Read on to hear what took place during the tracks on Market Transformation, Government Leadership, Innovative Technologies & Business Models, and Investment & Financing:

Market Transformation

 

Government Leadership

 

Innovative Technologies & Business Models

 

Investment & Finance

Market Transformation

1A: Increasing EE through connected systems: How can communities take into account holistic system efficiency from day one? 

The first panel of the day focused on holistic building systems and their role in increasing energy efficiency. Panelists discussed the exponential benefits that a systems approach to energy efficiency provides — not only in buildings, but in campuses, communities, and cities as a whole. While the United States is currently meeting the technological limit to “component-level” efficiency, systems efficiency provides building infrastructure with new energy saving opportunities. Along with a robust discussion on energy systems, panelists also provided suggested policy approaches to address the myriad of multi-level policy that is required in order to incentivize building owners and ensure that a systems approach to efficiency is possible. Energy is lost through heat in amajority of systems, thereby unnecessarily lowering energy productivity — and the panelists referred to examples ranging from HVAC systems in supermarkets to industrial cities in Northeast China. Rob Thornton, president and CEO at International District Energy Association, compared the shift from landline phones to cell phones to the shift that will happen between a sector energy system to a holistic energy system in campuses, communities, and buildings.

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2A: Buildings of the Future: How do we design and construct energy-efficient, resilient and climate adaptive buildings?

This panel focused on the market transformation in the buildings of the future, and featured Sheila Hayter of ASHRAE, Ersilia Serafini of the Summerhill Group, Mark MacCracken of CALMAC Manufacturing, Michael H. Mazor of Dow Chemical Company, Elizabeth McDonald of Canadian Energy Efficiency Alliance, and Chuck Kutscher of the National Renewable Energy Laboratory. Buildings consume a significant amount of energy across the world – in the U.S. this equals about 40% of energy and 70% of electricity. When we think of the existing 114 million homes and 80 million square feet of commercial building space, there is certainly a lot of potential for energy savings. However, the landscape is changing and buildings will need to be designed and constructed to not only be energy-efficient, but will also need to be resilient in the face of a new set of climatic conditions. There are a range of methods that can be used to address these issues like improving specific components within the building itself, coordinating components that make up the building system and educating the people that live and work in these buildings. If any of these components are ignored, it will leave a significant amount of savings left unrealized.

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3A: Examining the energy-water nexus: How can we scale up efforts to meet the critical need for energy and water efficiency in water infrastructure and end uses?

Ramola Musante, Vice President of Government Relations at Ecolab and Chairwoman of the Alliance’s Energy-Water Nexus Subcommittee, led a great discussion on the energy-water nexus and the policies and projects that will advance energy and water efficiency in water infrastructure systems and end use. Speakers representing the public, private, and utility sectors gave their perspectives on this important topic and landed on a few major takeaways for session participants, namely that the nexus needs more attention, education, and engagement from all decision-makers, and that collaboration between stakeholders is critical.

During the panelists’ remarks, it was made abundantly clear that all parties believe public-private partnerships can help advance and finance projects and the necessary innovations that will continue to drive water savings in industrial processes and consumer end use. During the Q&A session, panelists and participants alike noted the importance of collaboration and communication between experts in the areas of water and energy in driving these innovations. A testament to that effort, Musante and Rob Ivester of the Advanced Manufacturing Office at the U.S. Department of Energy (DOE) both noted that the DOE is working agency-wide to investigate all areas touched by the energy-water nexus and make sure the federal government is working appropriately to coordinate efforts across all sectors. Finally, the last big takeaway discussed during the session was the fact that we need to get people energized and engaged around the energy-water nexus issue like they are about energy efficiency in their homes and businesses.

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4A: Creating more, using less: How can we leverage continuous improvement and lean processes to double energy productivity in manufacturing?

The industrial and manufacturing sectors are energy-intensive, which means that there is a significant potential to address energy consumption through the adoption of energy efficiency. This session’s panelists outlined several barriers preventing widespread investment in energy efficiency projects as well as great avenues that could help overcome these barriers.
The primary barrier mentioned was the low cost of natural gas. As the primary energy input in these sectors, natural gas is a significant factor towards the cost of production. Panelists discussed that, in this day and age of cheap natural gas prices, at least in the United States, it makes the return on investment time scale too long for most companies to consider. However, cheap prices are not the only thing to consider. In many countries, access to natural gas can be a problem; even with low prices, availability may still be an issue. In this regard, these sectors can reduce the impact of a short term shortage of natural gas on their operations by investing in energy efficiency.

The common theme for what is needed to drive further adoption of energy-efficient practices in these sectors is an effective political or legal framework. Richard Northcote of Covestro made the point that if industry is allowed to waste energy and pour greenhouse gases into the atmosphere and remain viable, there is no incentive to change. Klaus Breil, DENEFF, described a similar situation within the European Union (EU). As part of the EU regulation, each member country has the right to set its own energy policy, which leads to much diversity across the region and makes it difficult for the EU, in its entirety, to make collective progress. However, a strong framework can be difficult to achieve, depending on the political climate, which means that alternative avenues need to be explored as well to increase investments in energy efficiency.

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Government Leadership

1B: Beyond COP21: What role will energy efficiency play in the post-COP era?

With the historic COP-21 agreement signed last month, embarking into a new era of global cooperation, this packed executive dialogue session dove into the role of energy efficiency beyond COP-21. Moderated by World Resource Institute’s building efficiency initiative director, Jennifer Layke, the session gave an international, national, and city perspective of government leadership for energy efficiency in a 1.5 degree Celsius world.

From the international perspective, Sandrine Dixon-DeCleve, chief partnership officer at Sustainable Energy for All suggested that focus should be on bringing the right actors into the discussion and to think about energy efficiency from a systematic approach — viewing energy productivity as the flipped role of renewables — and creating an angle of energy efficiency down to the infrastructure level combined with innovation.

Melanie Nakagawa, deputy assistant secretary for energy transformation with the State Department, reiterated energy efficiency’s bipartisan appeal as a key to collaboration, and emphasized the importance of framing efficiency’s economic benefits. Jon Jutsen, chairman of the Australian Alliance to Save Energy, emphasized integrating businesses and developing roadmaps for countries. Dave Turk, deputy assistant secretary for international climate and technology at the U.S. Department of Energy, shared perspective on technology and industry. He echoed the importance of collaboration, particularly at the intersection of energy access and developing countries in order to achieve the Paris climate goals. Finally, from the cities perspective, Michael Geissler, CEO from the Berlin Energy Agency, accentuated the bottom-up approach, suggesting that cities can set an example for the national and global level. Panel speakers emphasized climate financing, the importance of scaling up projects to incentivize investment, and continuously showcasing successes and failures alongside proper data monitoring.

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2B: Beyond Clean Power Plan: How do you design a regulatory framework for utilities that drives energy efficiency and climate mitigation?

The Clean Power Plan, the impending national standard to reduce carbon emissions from power plants, was discussed by a stellar Executive Dialogue panel that included Sarah Dunham of the Environmental Protection Agency, Judi Greenwald of Department and Energy and Congressman Paul Tonko (D-N.Y.). The panel provided dialogue on how energy efficiency policies are critical for a low-carbon future, emphasizing that energy policies have paved the way for Clean Power Plan regulation despite its current stalemate in the Supreme Court. Further, the panel discussed how the Clean Power Plan has two primary paths for compliance: mass-based and rate-based. Judi Greenwald reminded the audience that states have a long history implementing energy efficiency programs.

Along with a federal framework to hit our target, Congressman Tonko supports states to be on the leading-edge of policy development, including net metering, storage mandates, and workforce transition — all while pulling in utilities as an important stakeholder in the regulatory framework discussion for driving energy efficiency gains and mitigating climate change. National Grid’s John Isberg shared that energy efficiency has been a large part of National Grid’s carbon-reduction strategy. During the question and answer session portion of the panel discussion, speakers agreed about the importance of collaboration in transforming the regulatory framework and sharing best practices.

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3B: Subnational governments: How are they serving as living policy laboratories?

In the U.S. and other countries, energy-efficiency policy is shaped in innumerable ways by activities undertaken by subnational governments city-level and above. Importantly, transmission of policy ideas can occur both top-down and bottom-up between national and subnational governments. In fact, some Alliance federal policy priorities, such as a national energy efficiency resource standard, are based directly on initiatives first taken by states. Others important policies, like building energy codes, are defined at the national level and then implemented by state and local governments. Furthermore, major efforts in new program design are currently underway in utility regulations, financing, and customer outreach.
A probable explanation for subnational energy efficiency policy influence and innovation is the proximity of subnational governments—especially cities—to consumers. “Energy efficiency is very local,” explained panelist Odon de Buen, Director General of the Comision Nacional Para el Uso Eficiente de la Energia (CONUEE). Benefits of energy efficiency are realized by homeowners, businesses, and other end-users, who then provide positive feedback that subnational governments are first to hear.
Panelists also discussed the importance of measuring quality data and targeting energy efficiency to hit particular targets, including economic development, cost savings and greenhouse gas reductions. Dr. Francis Slakey with the Georgetown University Prize, noted a particular instance in Chattanooga, Tennessee in which energy efficiency was used in order to promote economic development. Mr. de Buen discussed the importance of energy efficiency in cost-saving efforts, including lighting improvements to help local governments control utility costs. And Eric Mackres with World Resources Institute and Sam Ricketts, who represents Washington Gov. Jay Inslee in D.C., touched upon the need for energy efficiency deployment at the subnational level to meet national and international sustainability goals.

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4B: Doubling energy productivity: How are private sector commitments and best practices advancing global energy productivity policies?

Moderated by ClimateWorks Foundation Director of Energy Efficiency, Dan Hamza-Goodacre, a knowledgeable group of panelists gathered to discuss doubling energy productivity, focusing on how private sector commitments and best practices are advancing global energy productivity policies. The panelists from The Climate Group, Mahindra & Mahindra, Johnson Controls, Covestro and Energy Unlocked represented a range of organizations working in support of improved energy productivity. Mahindra & Mahindra, Johnson Controls and Covestro have all committed to doubling their energy productivity within 25 years as part of the newly-launched EP100 program. Company representatives discussed the practices already in place, and those that will be put in place to achieve these goals. These best practices were wide ranging, and included prioritization of innovation, careful plant management, “energy hunts” and solid waste management, all of which promise meaningful improvements in energy productivity, lowered business risk and higher profitability.

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Innovative Technologies & Business Models

1C: Internet of Things: How are advances in connectivity driving energy efficiency and enhancing the consumer experience?

Panelists during this session roundly agreed that the “internet of things” will inevitably become increasingly integrated into energy management and usage. They agreed that this new connected approach comes with a host of benefits to enjoy if managed and advanced appropriately. To kick things off, longtime Capitol Hill energy veteran Allen Stayman, senior professional staff on the Senate Committee on Energy and Natural Resources and Dr. Kathleen Hogan, deputy assistant secretary for energy efficiency at the U.S. Department of Energy, touched on the strong history of appliance standards and resulting energy efficiency gains realized in this country through standards promulgated by the government. Both noted that advancing the “internet of things” is the real next step we need to take to further increase those gains.

Panelists from the private sector, including Christopher Kelson of Whirlpool, Dana Soukup of Siemens Building Technologies, Harry Verhaar of Philips Lighting, and Pekka Hakkarainen of Lutron Electronics, noted the powerful impact of technological advancements achieved by their respective companies and the interoperability that those technologies are having on the consumer experience while also saving energy. Several panelists offered examples of benefits that are perhaps not front of immediate mind — including smart lighting systems that can help detect crimes and reduce traffic problems, or human-centric lighting systems that can encourage better sleeping habits (which, of course, have positive effects on health and happiness). One of the biggest takeaways from this group of private sector panelists was that customers are now engaged more than ever in driving energy efficiency through the use of smart devices, which becomes so important when technologies are already near their maximum efficiency level. One point that resonated throughout is that the “internet of things” is here to stay and will continue to improve the economy, environment, and our daily lives — if we plan in coordination with the perpetual advancement of connected smart technologies.

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2C: Transforming transportation: How are we leveraging information and communications technologies to improve mobility and enhance efficiency?

This panel focused on the transportation sector transformation underway, aided by innovative technologies and the changing demands of today’s society. The discussion focused on a systems approach to transportation and how connectivity, autonomy, and electrification are revolutionizing modern transportation. “Ride-share” applications such as Uber and Lyft are giving consumers more options while simultaneously relieving congestive traffic through surge rates and live traffic updating.

Cars are becoming more autonomous, which decreases accidents caused by human error and reduces traffic, making the transportation system run more efficiently. The growth of electric vehicles and public transportation will reduce electricity demand on the grid, but must be aided by grid modernizations and public policy support. The panelists all agreed that the future of transportation, particularly in cities, will shift to a more personalized and consumer-connected system that will merge the private and public options of travel.

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3C: Intelligent efficiency: How can systems-level integration and intelligence reduce building energy consumption and operating costs?

Public policy and market-driven trends are increasingly influential in the way that energy consumption is managed in commercial and residential buildings. This executive dialogue, moderated by Clay Nesler, Vice President of Global Energy and Sustainability at Johnson Controls, introduced the concept of “intelligent systems” within the energy efficiency space as an opportunity for both the private sector as well as consumers. With nearly 30 percent of primary energy consumption worldwide coming from buildings, climate change mitigation must include strategies that improve upon efficiency within buildings, stated Srinivas Katipamula, Staff Scientist of Pacific Northwest National Laboratory.

According to Neal Elliott, Associate Director for Research at the American Council for an Energy-Efficient Economy, “Intelligent systems are less a new technology than a recognition of a structural change within the market.” With the advent of big data and the ability to manage trends in energy use and consumption, a systems-integrated approach has created a technological disruption which allows for devices to be monitored and for end-users’ consumption patterns to be analyzed.

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4C: Utility of the future: How are emerging technologies transforming the utility industry?

Lockheed Martin’s Roger Flanagan led a wide-ranging panel discussion on the evolving future of the utility model, from its historical origin to its adoption of new technologies, and the possibilities that lie ahead. Southern Company’s Kenneth Shiver rooted the conversation in utilities’ historical purpose—to bring the reliable, affordable energy that has powered our modern lives. The success of this model was based on the ability to scale and the ability to provide everyone with the same vital service.

The current moment represents a fundamental shift from a one-size-fits-all model to one of individualized customers needs and two-way and de-centralized energy relationships. Opower’s Marisa Uchin explained how software solutions are enabling a customer-driven transformation, comparable to that of the telecommunications industry. Francisco C. de la Chesnaye of the Electric Power Research Institute foresaw energy savings through efficiency of about 488 terrawats by 2035—about 10% of our current energy use. The session attendees drove a conversation that explored the ways in which an interactive grid will serve as a platform for innovation, diversifying energy resources, and greater efficiency.

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Investment & Finance

1D: Institutional investments: Do gains in energy productivity and sustainability resonate with big investors?

The first panel on institutional investments discussed the growing attractiveness – but also the barriers to – big investors investing in energy productivity and sustainability. Energy trends reported in the Sustainable Energy in America Factbook demonstrate that GDP can be decoupled from energy use, as GDP has risen significantly alongside a much smaller increase in energy consumption. Compared to alternative energy sources, energy efficiency plays the starring role in these energy productivity gains and accordingly can produce the “biggest bang per buck” in an investment portfolio. Panel speakers, including investment firm and advisory group representatives, noted that a portfolio of energy-productive investments is especially attractive for institutional investors with long-term perspectives such as pension plans. This type of investor is already beginning to shift away from electric utilities, oil, gas and goal investments due to risks to the business models in these industries, which – barring a change to business as usual – are threatened by the rise of energy productivity, energy efficiency and renewable energy. ClimateWorks Australia has recently conducted research that identified industries with the greatest energy productivity gains, and these are ripe for engagement by big investors.

Traditionally, energy efficiency has been a more challenging area in which to structure investments. Whereas there is a long history and expected returns for the utility, oil, gas and coal markets, investors lack the historical perspective of and confidence in energy productivity investments. Consequently, there is growing focus in the investment community on goal setting and disclosure (e.g., via EP100), and advisors are engaging with companies to help them understand how energy productivity improvements can make them more attractive, competitive investments – and through this, cultivate investor confidence in this type of investment.

There was also discussion on the merits of investing generally in companies that facilitate energy productivity in their market and for end users of their products and services, versus investing in projects that improve company operations. Some gap in financing exists because institutional investors fund more at the corporate level, whereas there remains a significant need for attractive, accessible project-level financing. In either case, culture change is a significant challenge in cultivating company buy-in from the factory worker to the CEO and Board, and instilling confidence in the potential energy/cost savings. Both of these, it was noted, are necessary for companies to engage in the goal setting and disclosure that the market increasingly demands.

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2D: Transitioning finance: What are the challenges of moving away from traditional grant-based programs and upscaling alternative energy efficiency financing programs?

Goals for energy efficiency and energy productivity have never been grander or more ambitious than they are now. On the heels of the COP-21 international climate agreement, the need for investments is likewise greater than ever before. According to panel moderator Peter Sweatman of Climate Strategy & Partners, annual investments worth $430 billion are needed to satisfy demands driven by global goals.

The challenge? Traditionally, energy efficiency projects have been encouraged primarily through grants, rebates, and tax credits and deductions. But these “one-way street” public-sector incentives are extremely limited and therefore inadequate. For comparison purposes, annual U.S. utility investments in energy efficiency add up to about $7 billion. Even the federal stimulus funds provided between 2009 and 2012 in response to the “Great Recession” totaled only $35 billion. In other words, we have a big gap on our hands to fill and overcome.

Necessity is the mother of invention, which is underway in developing new financing programs to leverage scarce public-sector grant dollars according to this premier collection of expert panelists. Innovation in aggregating and securitizing loans. Innovation in collateral and security. Innovation in new partnerships across the public and private sectors. And innovation in communicating the value of energy efficiency financing to traditional investors. Only if these innovations come together, which each panelist is committed to facilitating, will we have the capital to invest in critical energy efficiency projects.

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3D: Big investments: what are the best financing mechanisms for helping small and medium enterprises value and drive energy efficiency?

Joining the panel was Barry Bredenkamp of SANEDI, Stefan Buettner of EEP, Maria Fields of Joule Assets, James Wilde of Carbon Trust and Ashok Sarkar of the World Bank. Panelists addressed best practices in financing for small and medium enterprises (SMEs) to increase their value while pivoting on energy efficiency. The panelists reached consensus that achieving this goal will present a significant, although not insurmountable, challenge for the private sector. Indeed, the SME sector has immense potential for energy efficiency improvement, despite financial obstacles particular to this group, such as technical capacity and access to funding. Overall, there was a consensus among panelists that important approaches to boosting SMEs’ value while driving toward energy efficiency include: 1) raising awareness and understanding among SME players, and 2) creating the demand needed to provide capital for SME energy efficiency projects.

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4D: Carbon scoring: How can capital markets be used as a substitute for a carbon tax?

The final investment and financing executive dialogue session discussed ways capital markets could be used as substitutes for carbon taxes. A carbon tax would be a fantastic way to reduce carbon emissions, but there are two problems: politicians must agree, and it would need to be universally accepted. Katie Dykes, Chair of the Regional Greenhouse Gas Initiative (RGGI), discussed how RGGI serves as a type of carbon “tax”; the 9 RGGI states have experienced more than 45 percent reduction in carbon pollution since 2005, with no loss of GDP growth. James Koehler, President of the National Capital Area Chapter of the U.S. Association for Energy Economics, discussed experiments in other countries and what does and doesn’t work, such as widely fluctuating carbon prices from country to country. Once prices collapse — and trade at a narrower bandwidth — prices will stabilize, “which is the key to making this work.” Ken Locklin, President of Impax Asset Management, spoke of European equity investments and what he sees as the next phase of the market — mainly approaching climate as a risk-issue from a commercial standpoint, with some parties interested in climate solutions as an investment.

The panelist’s remarks were followed by a robust discussion from the audience, with topics ranging from how fossil fuel intense countries like Saudi Arabia are tackling carbon emissions, the role of insurance and reinsurance companies in financial flows, energy efficiency versus other low carbon projects, and third party credible bond ratings – such as the Alliance’s CarbonCount metric.